I beg to move, That the Bill be now read the Third time.
I will start with a short summary of the Bill. Which will amend two sections of the Space Industry Act 2018 to provide legal certainty that all spaceflight operator licences must include a limit on the amount of the operator’s liability to the Government under section 36 of the Act. The reason for that is that under international law applicable to space, Governments including the UK are liable for damage to property or death or personal injury caused by space activities. Section 36 passes on that liability to spaceflight operators and requires them to indemnify the Government. Without legal certainty over a cap, much-needed investment in the UK space industry, which is critical for defence and civilian purposes, will be held back, and that investment will go elsewhere. That is the purpose of the Bill: to encourage vital investment in our space sector, of which we should be proud.
I realise that parliamentarians in this place have not always been enthusiastic about space. When the Soviet spacecraft Luna 2 reached the surface of the moon on 13 September 1959, the Foreign Secretary Selwyn Lloyd, who went on to be a Speaker of this place, reacted with great enthusiasm. He said:
“I don’t think many people are terribly interested in the Russian rocket”,
despite it being historic. Harold Macmillan, on the other hand, was much more enthusiastic. When Armstrong and Aldrin were waiting in the lunar module, and we had had a man on the moon, Harold Wilson said:
“We must all be filled with a profound sense of wonder and admiration in witnessing this historic event.”
In fact, the UK played an important role in that space mission, and UK industry was involved, too. There was somewhat of a stooshie—a Scots word for a row—about the failure of the British ambassador to attend the launch, and his letter in the National Archives explains why. His explanation basically boils down to the fact that he had been to one previously, and that once you have seen one space launch, you have seen them all. It just goes to show that the importance of the special relationship is nothing new, but it did cause somewhat of a stooshie. Of course, nothing in 1969 was as important as Newcastle United winning the Inter-Cities Fairs cup.
My hon. Friend just talked about the importance of the space sector to so many of us and, indeed, to the whole of the UK. Will he join me in welcoming this Labour UK Government’s investment in the space sector in Scotland?
Yes. The UK Government have invested in Orbex, in Forres in the north of Scotland. It remains important to give grants to earlier-stage companies because they cannot get the equity and debt funding that more advanced companies can, so I welcome that important investment.
The space sector and satellites are central to almost everyone’s day-to-day lives. When we tap in and out of the underground on the way home or when we purchase things, that relies on satellite technology. Space is also a key focus for the national wealth fund, as confirmed by Lord Livermore, who is Financial Secretary to the Treasury, and John Flint, the chief executive of the national wealth fund, when we discussed the fund at the Treasury Committee this week. Space is an important future business for Britain, and an important economic opportunity.
Another reason why it is important to invest in space is for defence—it is critical to the defence of the United Kingdom. If we have a vibrant space industry in the United Kingdom, that will support the technological innovation we need to defend our country and our allies as we move into a much more difficult foreign policy context.
I am sure my hon. Friend will be aware of the role that the Starlink system has played in Ukraine in enabling the frontline operations of the Ukrainian army. For a very long time, GPS was the main determinator of whether Trident could arrive at its destination. It strikes me that in some ways the technology, our ability to put things into space and what we are putting up there will be what absolutely determines the nature of warfare in the 21st century; does my hon. Friend agree?
My hon. Friend makes an important point. The UK Government have committed to investing in defence and in advances in tech defence. As we develop defence, investing in space is utterly critical and central to that. It is a matter of some regret that Scottish companies that invest in military matters are not funded by the Scottish National Investment Bank or Scottish Enterprise, because they have the view that we should not invest in defence, even though it will create jobs and is important for defending the north of Scotland, which is where my mother came from and which is now very important for defence.
I am an MP for Glasgow, which has a rich history of innovation and an incredibly promising cluster of space expertise. My seat has the fantastic University of Strathclyde. I recently met Professor Malcolm Macdonald from the university, who is the director of the centre for signal and image processing and the applied space technology laboratory. He outlined to me with great enthusiasm and knowledge the amount of innovation in the space sector in Glasgow and across the United Kingdom. This is a critical industry that we must invest in and for which we must create the conditions of investment. Around 52,000 people work in the space sector across the UK, so this is a big opportunity.
Let me turn to talk about precisely what the Bill does, albeit with four words: it seeks to limit space operators’ liability. I emphasise that spaceflight activities are heavily regulated by the UK Civil Aviation Authority for safety. There is day-to-day scrutiny of their safety from an expert safety regulator—the CAA is one of the best regulators in the world—so we are concerned with small risks that are reduced to the very minimum extent possible by a very strong regulatory regime. One of the reasons why our family of nations has a great advantage in space is that because we are right at the end of Europe, we have a great place to launch, because we do not launch over big urban areas. If we go right up to Shetland, there is nothing for hundreds of miles.
Does my hon. Friend agree that the space sector gives our country—and indeed to the world—a sense of possibility and innovation? He talks about the four words in the Bill—Buzz Lightyear provides us with another four words to take inspiration from: “To infinity and beyond!”
My hon. Friend makes an excellent point, as she does regularly. The space sector creates enthusiasm for young people. When I met young students at the University of Strathclyde, I could see that it had engendered excitement about the future, and that is a good thing.
I draw Members’ attention to my entry in the Register of Members’ Financial Interests. I speak on this Bill as the chair of the all-party parliamentary group for space. I congratulate the hon. Member for Glasgow East (John Grady) on having such a massive effect on the UK space industry by changing just two words in the Space Industry Act 2018. His Bill is perhaps one of the most sublime Bills relating to the space sector that I have seen. It is truly incredible that we can have such a change to our industry.
We have had a space sector in this country for many years and it has been quite successful. As we have heard, it is currently worth about £19 billion a year and employs about 52,000 people, but the sector’s potential is absolutely enormous. The expectation is that, by 2035, the global space sector will be worth £1.8 trillion, and it is the ambition of this country at some point to get about 10% of that sector. That would be £180 billion a year of economic activity, so it is incredibly important.
The hon. Gentleman made important points about the space sector and all the exciting things we can do beyond the Kármán line in space. Importantly for those Scottish Members present, we will see the most symbolic part of the space sector to the north of Unst in the Shetland islands, hopefully before the year is out: a launch from British soil. That is genuinely very exciting.
Our whole economy can benefit. The hon. Gentleman is helping to open up an opportunity for the City of London, which for a long time has been a financer of innovation, trade and many different things. Importantly, it has been one of the biggest wholesale and specialist insurance markets in the world. By changing two words in the 2018 Act, the hon. Gentleman is not only unleashing spaceflight licensing for the UK but unleashing yet more opportunity at Lloyd’s of London. On top of that, as we see more space businesses coming to locate in the UK because of that opportunity, we will see even more opportunities, such as space companies being listed on the London stock exchange, bond issues and a whole load of corporate finance activities. Beyond that, there will be yet more activity in the legal sector, for example. The Bill is therefore incredibly important. The hon. Gentleman has done something incredibly simple but incredibly important, and all in the space sector are incredibly grateful.
I thank my hon. Friend the Member for Glasgow East (John Grady) for bringing the Bill forward. I also thank the hon. Member for Wyre Forest (Mark Garnier) for chairing the all-party parliamentary group for space and for his promotion of the sector.
As the MP for Portsmouth North, I strongly support this pivotal Bill, which will unlock further growth in our already thriving regional space cluster. It will ensure that operators take responsibility but, critically, that their liability is limited. As we heard from my hon. Friend, that statutory provision will bring us in line with our competitors.
Portsmouth and the wider Hampshire region are increasingly central to the UK’s space ambitions. Through initiatives such as Space South Central, we are part of the largest regional space cluster in the country, which generates more than £3 billion annually and employs more than 5,600 people. In Portsmouth, our universities, small and medium-sized enterprises and global industry leaders work in close partnership to pioneer satellite applications, mission design and advanced technologies.
The Bill’s provision to offer limited Government indemnity to commercial launch providers is critical. It will lower barriers to entry, de-risk new ventures, attract investment and enable orbital missions from UK soil. That is not just theoretical; it has real implications for Portsmouth’s space sector.
Let me highlight some of the potential beneficiaries in my city. The University of Portsmouth’s Institute of Cosmology and Gravitation is actively designing small satellite missions, from Earth observation CubeSats to lunar radio probes. Its space mission incubator and CosmoCube projects are prime examples of innovation that stands to gain from accelerated launch capabilities. The university also hosts the South Coast Centre of Excellence in Satellite Applications—part of the Satellite Applications Catapult, which supports businesses in satellite development, data-driven services and AI applications. The indemnity will provide confidence to those SMEs entering into new orbit ventures.
I thank my hon. Friend the Member for Glasgow East (John Grady) for bringing forward this important Bill. It is fantastic to see space made in today’s programme to debate it. Many of the contributions have been out of this world. [Interruption.] I am sorry, Madam Deputy Speaker.
The Bill is a timely and necessary measure to sharpen the UK’s competitive edge in what is undoubtedly one of the most strategically important domains of our time. Having almost completed my first year on the armed forces parliamentary scheme, I have seen at first hand that our security relies not only on land, sea and air, but increasingly on the space domain and our assets in orbit. Satellite communications, Earth observation and precise navigation form the backbone of military operations, but also of our civil economy—I will come back to that later.
As my hon. Friend the Member for Crawley (Peter Lamb) pointed out in his intervention, any disruption up there has immediate and profound consequences to operations down here. We know at first hand that China and other nations are taking leaps and bounds in its drive to dominate the space domain, so anything we can do to strengthen the UK space economy is critical.
Before coming to this House, I was very fortunate that my team supported clients such as Defence Equipment & Support in negotiations around the space domain, in particular providing better commercial and buying support, which is critical, so I have seen at first hand the complexity of this emerging market, and how the public sector needs to keep up to date and respond to the demands and the asks of the private sector, and drive growth.
Just down the road from me in Harwell, a project completed by my former firm in 2023, the National Satellite Test Facility, received £120 million of new investment by the public sector through the Science and Facilities Technology Council. That shows that when we unlock investment, it is not just about the assets that end up in space, but about the big, chunky, complex engineering construction opportunities that are opened up in places such as the OxCam corridor, where my constituency sits. Through that work, I have seen how the private sector is poised and hungry to drive forward the next wave of space innovation. What is holding us back, generally, is not technology, talent, innovation or the drive for growth, but regulatory uncertainty. Despite the fact that the Bill relates to only four words, as my hon. Friend the Member for Glasgow East said, it will make a big difference.
I am enjoying my hon. Friend’s speech on space. I must declare that I prefer to have my feet firmly on planet Earth, but none the less I am enjoying his contribution. I have been advised that men are from Mars and women are from Venus. Where does my hon. Friend think those on the second Opposition Bench are from?
There are treaties under international space law, and the UK Government have a long-standing legal liability for damage caused by UK spaceflight-related operations. Despite the space safety regime, there is a residual risk that things go wrong and the UK Government face claims. The UK Government can make claims against operators, which take place under section 36 of the 2018 Act. That is quite proper. Operators have to assume and bear risk, and the Government need to ensure that operators can pay out on claims made against them—as we are quite rightly adopting a cross-party spirit today, I commend the previous Government on their work on space law—which is why the regime under the 2018 Act makes provisions for space operators to put in place compulsory insurance.
The businesses have to insure themselves and are regulated by a very competent regulator. The question is: what happens if a claim exceeds the amount of insurance that can be put in place on a sensible basis? That is really what we are addressing here. The current legislation does not require the Civil Aviation Authority or the Government to include a cap in the licence; it makes it optional. Section 12(2) of the 2018 Act provides:
“An operator licence may specify a limit on the amount of the licensee's liability under section 36 in respect of the activities authorised by the licence.”
The critical thing that my Bill will do is quite simply to swap “may” for “must”, and as a consequence the word “any” in section 36 is changed to “the”. That is consistent with long-standing Government policy that the liability should be limited—there is a clear, documented policy that it is limited.
However, the problem with documented policies as opposed to statute—as a recovering lawyer, I go back to my legal career here—is that Government policies are ultimately much easier to change than statutes. We can have a claim for legitimate expectations and a breach of those, but that is a very difficult class of claim to run, and there has not been a huge number of successful cases of that sort in the courts. It is a difficult area of public law.
Business quite properly says, “You could change this policy and expose our existing investments to additional risk.” Business could also fairly go and look elsewhere for investment. Investors will not invest in the same way in the face of a lack of statutory protection, so the critical thing the Bill does is to include a statutory protection. It requires the Government to cap the liability and encourages people to invest, and that puts us on a par with our principal competitor nations for space investment. So, four words to the Bill, with two swapped, but it is absolutely critical for the future of an industry that could be brilliant for the United Kingdom and all our constituents for years to come.
I have a small anecdote about Buzz Lightyear—we heard mention of his catchphrase, “To infinity and beyond!” I met Buzz Aldrin’s son a few years ago and made a joke about “To infinity and beyond” to him, and he turned around to me and said, “The Disney corporation never paid my dad enough for that.”
I congratulate the hon. Gentleman on his Bill. It will be truly transformational.
In the private sector, global giants such as Airbus Defence and Space operate from Portsmouth’s Hilsea facility. Its multimillion-pound Oberon reconnaissance satellite contract with the Ministry of Defence sustains 1,000 local jobs—roles that will be bolstered by a more robust UK space launch ecosystem. It also provides fantastic apprenticeship opportunities for young people.
Hampshire-based firms such as QinetiQ, BAE Systems, Lockheed Martin and Airbus are deeply integrated into space innovation and, locally, into our communities. With the Bill’s indemnity framework, these organisations—universities and companies alike—will gain access to faster mission approvals and greater capacity to adopt emerging UK launch providers, with results including new jobs, expanded contracts, strengthened regional growth and a win for my city.
Let us consider the Bill’s impact. More research-led satellites such as CosmoCube could be developed and launched from Cornwall or Scotland, but Portsmouth businesses will be able to contribute all the way from design to orbit. Portsmouth’s science, technology, engineering and maths pipeline, from UTC Portsmouth through to the university’s Mission Space programme, will benefit enormously from real, home-grown launch activity. That will inspire students, help retain talent and create new high-tech career paths. Charities and public services will also benefit. Space-enabled monitoring applications powered by data from low-cost satellites could support coastal management, environmental protection and emergency response in my maritime city.
It would be remiss of me not to mention the charity that I am a trustee of, STEMunity, which had a fantastic reception this week and, by working with a number of other charities and public and private sector companies, has introduced young people to the world of space.
This is not just a technical fix of four words; it is a strategic piece of legislation that can help cement Portsmouth’s place in the UK space age—and, indeed, the UK in the world—by reducing risk for our inventors.
The Space Industry Act 2018 laid the groundwork for the modern commercial sector we have in space. I commend the previous Government, as we are debating in a spirit of collaboration and co-operation across the House, for their work on that and for the space industrial strategy, which was published later. I can see echoes of that now in the industrial strategy, and I know that when the defence industrial strategy comes out later in the year, space will be front and centre of that as well. It is positive that we can build on some of the good work done by the Conservatives.
Without knowing what financial exposure firms might face if an accident or an incident occurs, companies hesitate to invest, insurers demand eye-watering premiums, and ultimately, we lose manufacturing contracts to other jurisdictions. The simple but powerful adjustment made by the Bill changes the law so that the indemnity limit for each operator licence is not optional, but mandatory. Each licence must spell out the licensee’s maximum liabilities. This is an essential risk management mechanism and it means that companies know exactly what they are signing up for. It also allows them to secure insurance in a predictable way. In the construction sector, we had a lot of unpredictable insurance post-Grenfell and particularly post-industrial shock, so I know how, for a commercial business, insecure insurance and unpredictability of insurance is important.
The Government’s new industrial strategy is really positive for the space sector. In my constituency, the Bill will stimulate jobs and growth. It specifically recognises that the Government will be investing in research and development for the space industry through the Cambridge Growth Company, which will drive new opportunities for my constituents.
When we consider this issue, we must also remember the wider stakes.